Freight prices at Indian ports increased by about 70% year over year in August, suggesting persistent demand and continuous interruptions in global shipping. The financial strain on Indian businesses is increased by this growth. There is a two-year pause before the rise.
40-foot-high cube container prices increased from $2,600 in Q1 2024 to more than $2,800 in Q2, with prices rising throughout ports such as Mundra, Nhava Sheva, and Chennai. According to industry analysts, the trend increased in the third quarter.
Shipping prices have increased dramatically due to geopolitical concerns and influenced businesses who have a lot of worldwide exposure. In FY25, margins are anticipated to be squeezed by these increased costs.
Freight rates have changed significantly since 2020; originally, they increased because of Covid-19 interruptions. Due to conflicts such as the Red Sea crisis, which prompted ships to take longer routes, increasing time and expenses, rates started to decline in FY23 but then started to rise again in early 2024.
Chennai witnessed the most increase in container costs of any Indian port, going from April to August 2024 at a rate of 50% to $2,340. Higher local demand and congestion, according to Christian Roeloffs, CEO of Container xChange, were factors in this increase.
Director of India Ratings & Research Khushbu Lakhotia stated, “After a brief pause, rates shot up further in May and June 2024, exacerbated by a container shortage, particularly for cargo originating from North East Asia, given the impending duty hike on electric vehicles announced by the US.”
However, data from Container xChange indicates that August had a minor month-over-month decline, coming in at $2,100 as opposed to $2,200 during July.
